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If a company unexpectedly issues debt (rather than stock), the Signaling Theory suggests: managers believe the company has very good near-term prospects. managers believe the

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If a company unexpectedly issues debt (rather than stock), the Signaling Theory suggests: managers believe the company has very good near-term prospects. managers believe the company has very poor near-term prospects. managers believe interest rates are going to fall over the next several years. managers believe interest rates are going to rise over the next several years. investors believe the company will default in the near-term

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